Click here for a great article on the topic of
Click here for a great article on the topic of RVUs Links to an external site https://mbamedical.com/blog/rvu-medical-billing/
and answer the question, “What is an RVU?”
This RBRVS may not completely make sense to you at this moment, but let me see if I can point out the importance of correct code sequence based on the RVU (relative value unit) and correct modifier usage when coding and this information should start making sense to you! The RBRVS is the Medicare Fee Schedule that drives the reimbursement process in ambulatory coding. Here we go…
When looking at Modifier -51, your text states you would code both services, and modifier -51 would be used after the lesser of the two codes. Your text says, “The procedure listed first should identify the major or most resource-intensive procedure, which usually is paid at 100% of the allowed reimbursement. Subsequent or secondary procedures should be appended by modifier -51, and payment may be reduced according to the terms of the health plan.”
Please note that it is not up to you to decide which of these codes is the lesser of the two. The way to tell is to look at the Relative Value Unit (RVU) for both codes and see which RVU is the higher of the two and sequence it according to this information. Some coders (and physicians!) have tried sequencing according to what they think is the higher of the two codes (based on the procedures, and which procedure they thought was more extensive or time-consuming) and in turn, they received less reimbursement because they were incorrect in their sequencing of codes.
Improper Sequencing
Let me show you how improper sequencing would affect reimbursement. We will use a “pretend” scenario that I’ll make up. Here is the scenario “…a patient had a laminectomy with lumbar disk removal (for a herniated disk) – code 63030 – and also had an arthrodesis (stabilization of the area where the disk was removed) – code 22612 – these are multiple procedures”.
Therefore, if we used the order the codes were given in our scenario (or perhaps our Operative Report) our codes would look like this on our insurance claim form:
63030
22612 – 51
RVUs
Now, let’s take a look at our RVUs for this scenario and how they can affect our reimbursement. I will use a reimbursement amount given by Medicare. Some other third party payers may reimburse lower and some may be higher. We know from Chapter 11, there is a set amount paid per one Relative Value Unit. For instance, if a procedure code was listed as RVU = 1, and the reimbursement for one RVU for that particular place of service was paid at $55.00 per RVU, this procedure would be paid $55.00 total (1 x $55 = $55).
With this in mind, let’s look at how the codes in our scenario will be reimbursed by percentage if we sequenced them in the order listed on our documentation:
Code 63030 will be reimbursed at 100% of the allowed amount by the insurance company because this is our primary procedure.
Code 22612-51 will be reimbursed at 50% of the allowed amount by the insurance company, because it is listed as the second procedure and has a modifier -51 (multiple procedure). The terms of our health plan state the subsequent or secondary procedure is paid at HALF of the TOTAL amount for that procedure (or 50%).
Now, let’s look at this in dollar amounts:
Code 63030 = 25.01 RVUs and Code 22612 = 41.35 RVUs (both RVUs are based on the Medicare Billing and Reimbursement Guide).
Remember, one RVU is paid at $55, so code 63030 with 25.01 RVUs = $1375.55 (25.01 x $55) and code 22612 with 41.35 RVUs = $2274.25 (41.35 x $55).
The reimbursement will be:
Code 63030 = $1375.55 (because the first procedure is paid at 100%)
Code 22612 -51 = $1137.13 (because the second procedure is paid at 50%)
Our total reimbursement would be $2512.68.
By the way, this is not the correct way to code this! But, we used the order the codes were given in the scenario, remember?
But, now let’s assume you are the coder and you know better, because you took the CPT Coding course at Hutchinson Community College, right?! You look in the Medicare Billing and Reimbursement guide and see the RVUs and realize that 22612 has the higher RVU, so you sequence it first, and sequence code 63030-51 second.
Note: it is not the responsibility of the third party payer to make sure the codes are sequenced correctly. They will only reimburse according to the way we code it!
Third Party Payer
Here is how the third party payer would reimburse for these procedures after you’ve coded it correctly.
The reimbursement would be:
Code 22612 = $2274.25 (because the first procedure is paid at 100%)
Code 63030 – 51 = $687.78 (because the second procedure is paid at 50%)
Our total reimbursement would be $2962.03.
This is a difference of $449.35.
This may not seem like a lot for this one encounter, but if you were the physician and your coder continued to code this procedure the wrong way, all year long, it would result in quite a decrease in your reimbursement. What if your physician performed this procedure once each week for that year? How much would your coding affect his reimbursement? Let’s see…
$449.35 x 52 weeks in a year = $23,366.20 less reimbursement a year!
Would $23,366.20 less a year affect you and your family financially?
Now you see the importance of correct sequencing according to Relative Value Units – never assume you know – always check it out!
Discussion Prompts
Post to this Discussion Forum answering the following questions:
Did you know about the Resource-Based Relative Value Scale (RBRVS) and Relative-Value Units (RVUs) prior to taking this CPT Coding course? If so, what has been your experience?
What was your reaction to the scenario above after realizing the difference in reimbursement when coding and assigning modifiers according to the RVU?
Post your response to the questions above then respond to at least two other student’s posts.
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