CA Pathology/Clinical Laboratory Billing: NCCI Edits Do Not Apply

Medicare’s National Correct Coding Initiative (NCCI) complicates California workers’ comp billing, to say the least.

NCCI edits are the source of much confusion, as providers across the state consider whether a given edit applies to their bill. Especially since NCCI edits may apply to procedure codes billed under one portion of the Official Medical Fee Schedule (OMFS), but not another, determining the correct reimbursement can be a struggle.

NCCI edits do NOT apply to the Pathology and Clinical Laboratory Services portion of the OMFS. However, NCCI edits apply to  pathology and clinical laboratory services billed under the Physician and Non-Physician Practitioner Services portion of the OMFS.

NCCI in CA Workers’ Comp

As the Centers for Medicare and Medicaid Studies (CMS) puts it:

The CMS developed the National Correct Coding Initiative (NCCI) to promote national correct coding methodologies and to control improper coding leading to inappropriate payment in Part B claims.

Put simply, Medicare designed NCCI edits to police the ways in which providers may combine codes and to restrict the number of billable units. NCCI edits include:

  • Procedure-to-Procedure (PTP) Edits, which disallow combinations of certain procedure codes
  • Medically Unlikely Edits (MUE), which limit the number of billable units for certain procedure codes
  • Add-on Edits, which identify procedure codes that are only billable in conjunction with certain other procedure codes

As California OMFS reimbursement rates are generally (but not exactly) aligned with Medicare, reimbursement calculations sometimes (but not always) include the application of NCCI edits. And as the debacle over MUEs for acupuncture demonstrated, it can be extremely difficult to parse when a given MUE applies to a California workers’ comp bill.

Even the DWC can find itself in the weeds, forced to reverse course on decisions regarding the adoption of Medicare edits.

NCCI for Pathology and Clinical Laboratory Services

In order for any NCCI edits to apply to California workers’ comp, the DWC must specifically adopt those edits and incorporate them into the OMFS. To date, the DWC has not adopted NCCI edits for the Pathology and Clinical Laboratory portion of the OMFS.

However, not all pathology and clinical laboratory services are billed under the Pathology and Clinical Laboratory services portion of the OMFS. Since physicians may bill some pathology and clinical laboratory services under the Physician and Non-Physician Practitioner fee schedule, NCCI edits may apply.

We base this conclusion on a similar situation the DWC addressed in 2014. Back then, the issue was physician-dispensed Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS). As a DWC Newsline explained, MUEs for certain DMEPOS codes were not applicable, because physicians billed under the DMEPOS portion (as opposed to the Physician and Non-Physician Practitioner portion) of the OMFS.

Similarly, for physicians providing pathology and clinical laboratory services, whether or not NCCI edits apply depends on which portion of the OMFS the procedure code is payable under. To determine the correct portion of the OMFS, check the Status Code Indicator of the procedure code:

  • If the Status Code Indicator is “A,” the code is payable under the Physician/Non-Physician Practitioner portion, and is subject to NCCI edits.

  • If the Status Code Indicator is “X,” the code is payable under the Pathology and Clinical Laboratory portion, and is not subject to NCCI edits.

If you are a DaisyBiller, not to worry: our software automatically alerts you whether NCCI edits are applicable.

It’s complicated, but that’s workers’ comp for you. As always, we’ll keep our readers up to date on any changes to the OMFS, including the adoption of NCCI edits.


There’s one way to be sure your reimbursement calculations are correct: use the OMFS Calculator, included in DaisyBill’s Work Comp Wizard. Try the Wizard free today, and see how much easier workers’ comp can be.

TRY THE WIZARD

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