Can you bill Managed Care the same way you bill Medicare for discontinued procedures?

Q: If we bill Medicare for a discontinued procedure, can we bill Managed Care the same way?

Some consultants are telling us that commercial insurance must follow Medicare guidelines. Other consultants are telling us that Medicare is allowing this billing practice to anyone who is paid under OPPS, that the ability to bill discontinued procedures is not a federal guideline that Managed Care must follow, but a contract with Medicare. Managed Care does not pay under OPPS so we would not be able to bill Managed Care for discontinued procedures. Instead, we must follow each particular contract.

A: The modifiers you cited are to be used in the Outpatient PPS system for “discontinued procedures”-outpatient surgical or diagnostic procedures that were started but discontinued by the physician due to “extenuating circumstances or to circumstances that threatened the well being of the patient”. Modifier 73 is used for a procedure that is discontinued AFTER the patient is prepared for the procedure but BEFORE anesthesia is administered or the procedure is started. Modifier 74 is used for a procedure that is discontinued AFTER the patient is prepared for the procedure and AFTER anesthesia is administered or the procedure is started. Medicare pays the provider for the costs incurred in preparing the patient, even though the procedure was not completed.

The modifiers for discontinued services MUST be used by providers billing the Medicare program for services to Medicare beneficiaries. In addition, payors offering Medicare Advantage or Medicare supplemental products with benefits that mirror Medicare coverage must provide payment for discontinued services. If the patient is not enrolled in a Medicare Advantage or Medicare supplemental product, the payor MAY accept the 73 or 74 modifier, but because the payor is not required to cover the same benefits as Medicare, it may not.

Whether this modifier would be accepted (and the discontinued procedure reimbursed) would depend on the terms of the patient’s insurance coverage and the terms of the contract between the provider and payor. Some payor contracts expressly refuse to pay for procedures discontinued for reasons which the payor deems to be inefficiency on the part of the provider or practitioner, such as scheduling conflicts for practitioners, equipment or procedure rooms, failure to properly prepare the patient, etc.

If the patient is NOT enrolled in a product providing Medicare coverage, you would need to determine the payor’s coverage policies for discontinued procedures. For more information on Medicare’s rules regarding Modifiers 73 & 74, click here.

Disclaimer: This question was answered by Robin Fisk, Esq, a lawyer from Ashland, NH. Please note that this response is an expression of opinion or informal guidance and is not intended as legal advice. Please consult with an attorney familiar with your specific circumstances.