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National Correct Coding Initiative Edits (NCCI)

Back in 1996, the Centers for Medicare and Medicaid Services (CMS) developed the National Correct Coding Initiative (NCCI) to promote correct coding and prevent inappropriate payment of Medicare Part B claims. As this is an automated prepayment review by CMS, the NCCI edits reduce payment error by identifying coding errors made by providers. In 2009, 7.8 % of Medicare dollars did not comply with one of more Medicare coverage, coding, billing or payment rules, translating into $24.1 billion dollars in Medicare overpayments and underpayments annually.

The NCCI edits define when two HCPCS/CPT® procedure codes may not be reported together except under special circumstances. The Centers for Medicare & Medicaid Services (CMS) based the NCCI coding policies on current coding conventions, coding guidelines, national and local Medicare policies (NCDs and LCDs), and standard medical and surgical practice. Coding polices and guidelines require that procedures are reported with the most comprehensive CPT® code that describes the services performed. For example, a coder should not report a Basic Metabolic Panel (BMP, CPT® 80047) with a Comprehensive Metabolic Panel  CMP,CPT® code 80053) as all the analytes in CPT® 80047 BMP are a subset of the Comprehensive Metabolic Panel and would have been already performed as part of that procedure.

As a claim is processed by the Medicare contractor, the system tests every pair of procedure codes to determine if they comply with the NCCI edit policy. This means every code pair reported for the same date of service for the same beneficiary by the same provider is reviewed against the NCCI-edit tables. If a pair of codes on the claim  matches (“hits”) a pair in the NCCI edit table, the “Column Two” code of the edit pair is denied for payment. Using the CMP/BMP example above, in the NCCI edit tables, CPT® 80047 is the “Column Two” code and would have payment denied.

NCCI-associated modifiers are used to indicate the special circumstances such as when the procedures are performed at different anatomic sites, a separate procedure or repeat clinical diagnostic laboratory test. If an edit allows use of NCCI-associated modifiers, the two procedure codes may be reported together. NCCI-associated modifiers may not be used to bypass an edit unless the criteria for use of the modifier are met.

Each active NCCI edit has a modifier indicator of 0 or 1. A modifier indicator of “0” indicates that an edit can never be bypassed even if a modifier is used. In other words, the Column 2 code of the edit will be denied. A modifier indicator of “1” indicates that an edit may be bypassed with an appropriate modifier appended to the Column 1 and/or Column 2 code.

The NCCI-associated modifiers are: E1, E2, E3, E4, FA, F1, F2, F3, F4, F5, F6, F7, F8, F9, LC, LD, RC, LT, RT, TA, T1, T2, T3, T4, T5, T6, T7, T8, T9, 25, 27, 58, 59, 78, 79, and 91. In January 1, 2013, additional modifiers were added to the list of NCCI-associated modifiers that will allow an edit to be bypassed when the modifier is used correctly (i.e., edits with modifier indicator of “1”). These were LM (left main coronary artery), RI (ramus intermedius), 24 (unrelated evaluation and management service by the same physician during a postoperative period), and 57 (decision for surgery).

Effective Jan 15, 2015, new more specific modifiers  become effective (see also Compliance Matters, Sept 2014) supplementing Modifier -59 (Distinct Procedural Service).

XE Separate Encounter: A Service That Is Distinct Because It Occurred During A Separate Encounter

XS Separate Structure: A Service That Is Distinct Because It Was Performed On A Separate Organ/Structure

XP Separate Practitioner: A Service That Is Distinct Because It Was Performed By A Different Practitioner

XU Unusual Non-Overlapping Service: The Use Of A Service That Is Distinct Because It Does Not Overlap Usual Components Of The Main Service

These modifiers, collectively referred to as –X{EPSU} modifiers, define specific subsets of the -59 modifier. CMS will not stop recognizing the -59 modifier but notes that CPT instructions state that the -59 modifier should not be used when a more descriptive modifier is available. CMS will continue to recognize the -59 modifier in many instances but may selectively require a more specific – X{EPSU} modifier for billing certain codes at high risk for incorrect billing.

Services denied based on NCCI edits may not be billed to Medicare beneficiaries, nor can a provider use an “Advanced Beneficiary Notice” (ABN) to seek payment from the patient since these denials are based on incorrect coding rather than medical necessity or a benefit exclusion.

Hospitals, like physicians and other providers, must follow national correct coding policies. Though the NCCI edits were initially developed for processing professional claims, the NCCI edits are incorporated into the Outpatient Code Editor (OCE) used for processing outpatient hospital service claims, outpatient physical therapy and speech-language pathology services, skilled nursing facilities (SNFs), comprehensive outpatient rehabilitation facilities (CORFs), and home health agencies (HHAs). These are commonly referred to as the NCCI “Hospital” Version of CCI edits.

Review the NCCI manual on CMS here: http://www.cms.gov/Medicare/Coding/NationalCorrectCodInitEd/index.html?redirect=/nationalcorrectcodinited/