Medicare requires a secondary diagnosis for certain primary diagnosis codes when doing lesion removals for certain procedure codes. Example, procedure code 11402 with diagnosis sebaceous cyst 706.2 will deny unless there is a secondary diagnosis from their list of payable secondary diagnosis. Sometimes we don't have a code on their list and need to review the claim with the office note. My question is, if in the note the cyst was previously infected, and the doctor is waiting until the infection is gone before removing the cyst, can we use the infection as the secondary diagnosis (which is on their list) on the lesion removal even though there is no infection at the time of the removal?
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Removal of Benign Skin Lesions
1.Q: Is the excision of benign skin lesions ever covered by Medicare?
A: Yes, there may be instances where the removal of benign skin lesions (such as a nevi, wart, skin or cyst) is medically necessary. Some examples could be:
Bleeding of the lesion(s)
Intense itching of the lesion(s)
Obstruction of eye function or of an orifice
Frequent irritation or inflammation of lesion(s) including pain
Increase in size, number or change in appearance of lesion(s) suggestive of potential malignant conversion
2.Q: What if the physician is suspicious of a possible malignancy but the lesion has not been removed or biopsied? Can the physician excise the lesion and biopsy concurrently?
A: Documentation must support the realistic potential for malignancy based on lesion appearance and/or prior malignant conditions. If there is clinical uncertainty as to the likely diagnosis, excision of the lesion(s) may be covered. With the exception of MOHS surgery, billing for a biopsy on the same day as an excision is not medically necessary as the specimen from the excision can be used for the histopathological diagnosis
3.Q: If the patient wants a lesion(s) removed because of where it is located (visible to others) but there is no other reason to remove the lesion(s) does Medicare cover this?
A: No, the removing of benign skin lesion(s) that do not pose a threat to health or function is considered cosmetic, and as such, is not covered by the Medicare program. These cosmetic reasons include, but are not limited to, emotional distress, "makeup trapping," and non-problematic lesions in any anatomic location. Lesions in sensitive anatomical locations that are not creating problems do not qualify for removal coverage on the basis of location alone.
4.Q: If the patient insists on having ‘cosmetic' lesions removed how does the physician get paid if it is not covered by Medicare?
A: Cosmetic procedures are considered excluded from Medicare coverage and as such are not a benefit. You may bill the patient directly if a properly completed Voluntary ABN (Advanced Beneficiary Notice) is executed and signed by the beneficiary prior to the procedure. The form is available at: www.cms.gov/bni
5.Q: Is every record for a benign skin lesion removal reviewed for medical necessity? How does a physician's office indicate the removal meets coverage guidelines?
A: The patient's medical record must contain documentation that fully supports the medical necessity for the services. Every claim is reviewed to verify coverage requirements are met; either by a clinician or by the claims processing system as an automated review. Each claim must be submitted with ICD-9-CM codes that reflect the condition of the patient, and indicate the reason(s) for which the service was performed. Claims submitted without ICD-9-CM codes will be returned. This means claims may require multiple ICD-9 codes indicating the presence of the lesion AND the reason the lesion requires removal.
An example of the coding requirements would be:
Patient presents with a lipoma (fatty mass) under the right arm just below the axillary region. Deodorants and clothing continually irritate the mass and the patient frequently has a painful contact dermatitis from the lesion.
Procedure code (CPT) 11042: EXCISION, BENIGN LESION INCLUDING MARGINS, EXCEPT SKIN TAG (UNLESS LISTED ELSEWHERE), TRUNK, ARMS OR LEGS; EXCISED DIAMETER 1.1 TO 2.0 CM
Primary Diagnosis (ICD-9 code) 214.1: LIPOMA OF OTHER SKIN AND SUBCUTANEOUS TISSUE
Secondary Diagnosis Code (ICD-9 code): 692.9 CONTACT DERMATITIS AND OTHER ECZEMA UNSPECIFIED CAUSE
Without the addition of the secondary diagnosis code, medical necessity is not evident with claim submission.
For more information please refer to your Local Coverage Determination: