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"Carving Out" Preventive Medicine Services
Pub.100-04, Medicare Claims Processing Manual, Chapter 12, §30.6.2 - Billing for Medically Necessary Visit on Same Occasion as Preventive Medicine Service
CPT codes, descriptors and other data only are copyright 1999 American Medical Association (or such other date of publication of CPT). All rights reserved. Applicable FARS/DFARS apply.
What are Preventive Medicine Services?
Preventive medicine services are represented by Current Procedural Terminology (CPT) codes 99381-99429, and are used to report preventive medicine evaluation and management services where no illness or injury is under management. Medicare does not cover these services and when billed, will deny as patient responsibility.
If an abnormality is encountered or a preexisting problem is addressed in the process of performing this preventive medicine evaluation and management service and if the problem /abnormality is significant enough to require additional work to perform the key components of a problem oriented E&M, then the appropriate office/outpatient code 99201-99215 should also be reported. Modifier 25 should be appended to the Office/Outpatient code to indicate that a significant, separately identifiable E&M service was provided by the same physician on the same day as the preventive medicine service. When the claim is billed, each service should be listed separately and the fees should be assigned using the "carve out" method.
“Carve Out” Billing Method
When a physician furnishes a Medicare beneficiary a covered visit at the same place and on the same occasion as a noncovered preventive medicine service, consider the covered visit to be provided in lieu of a part of the preventive medicine service of equal value to the visit. "Carve out" is a term used to refer to the portion of a routine visit that was medically necessary. To properly bill for a "carve out" service, please follow these steps:
- Determine your usual fee for the noncovered, routine physical examination. (Example: Fee for a preventive service is $150.00.)
- Using the Medicare Physician Fee Schedule, determine Medicare's allowed amount for the covered portion of the medically necessary E&M service. (Example: Medicare's fee schedule amount for the E&M is $57.00.)
- Bill the covered portion using the appropriate E&M code. Subtract the E&M allowance from the preventive service fee. Bill Medicare $57.00 for the medically necessary E&M service, and $93.00 for the preventive care code, which would equal the physician's usual fee for the noncovered, routine physical examination of $150.00.
The patient will be responsible for the $93.00 for the preventive care portion of the visit plus any co-insurance and unmet deductible resulting from the medically necessary E&M service.
Examples
Clinical specialists from Medicare’s Medical Review Department periodically review claim documentation. During these reviews, they have found situations where medical documentation reflected that a portion of the visit was indeed preventive in nature. However, a portion could have been billed as medically necessary using an appropriate level E&M code.
Patients have been charged for preventive care when medical notes indicate that they were seen for chronic conditions, such as hypertension. Please note that management of a chronic condition is considered medically necessary. Therefore, if the patient was seen for preventive care and for management of a chronic condition, two codes should have been billed to Medicare using the “carve out” method mentioned above.
Pap smear and pelvic/breast exams represent another example that clinical specialists have seen documented in medical notes, but not billed to Medicare Part B. Pap smear and pelvic/breast exams are allowed by Medicare and should be billed in addition to the routine visit using the "carve out" method. For more information on these preventive services as well as others, please go to www.cms.hhs.gov/PrevntionGenInfo/.
Advance Beneficiary Notice of Noncoverage (ABN)
The Advance Beneficiary Notice of Noncoverage (ABN) is a notice given to beneficiaries in Original Medicare to convey that Medicare is not likely to provide coverage in a specific case. An ABN is not required for preventive medicine services because Medicare never covers these services. Please note that while previously the ABN was only required for denial reasons recognized under section 1879 of the Act, the revised version of the ABN may be used to provide voluntary notification of financial liability. So, as a courtesy to the patient, the provider may choose to use an ABN to advise the patient that Medicare will not cover the service and that the fee for the service will be his/her responsibility. An ABN should be obtained when you believe that the service or procedure may be denied as not medically necessary. An example is when the diagnosis falls outside the scope of the local coverage determination (LCD). In circumstances where the service is covered by Medicare, but may not be in this situation, in order to collect payment from the patient, a signed ABN must be on file and the GA modifier appended to the procedure on the claim form. For additional information on the use of the ABN go to www.cms.hhs.gov/BNI/02_ABNGABNL.asp.
Please note that if the physician is providing a medically necessary visit on same occasion as preventive medicine service, he or she is not required to give the beneficiary written advance notice of noncoverage of the part of the visit that constitutes a routine preventive visit. However, the physician is responsible for notifying the patient in advance of his/her liability for the charges for services that are not medically necessary to treat the illness or injury.
Things to Remember
- It is not necessary to have the patient sign an ABN for a noncovered service.
- It is good practice to advise the patient that the preventive service is not a Medicare benefit.
- The patient’s record must contain adequate documentation that is legible and available upon request.
- Any medically necessary portion of a routine visit must be documented in the patient’s record and billed to Medicare using the appropriate level E&M codes.
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